Klobuchar Announces Program to Help Dairy Farmers

Friday, December 18th, 2009 at 6:02 am

Washington, D.C. – Today U.S. Senator Amy Klobuchar announced a new program that will help dairy farmers who have seen their livelihoods threatened by a sharp decrease in dairy commodity prices.  The Dairy Economic Loss Assistance Payment Program (DELAP) program was established as a result of an amendment Klobuchar cosponsored in the FY 2010 Agricultural Appropriations Act.  The program will use $290 million to make payments to dairy producers to help offset recent economic losses.

“Dairy farmers in Minnesota and across the country continue to struggle from the low dairy prices,” said Klobuchar, a member of the Senate Agriculture Committee.  “Minnesota’s farmers are at the heart of our agriculture industry and this program will help dairy farmers get through this rough patch.”

The Secretary of Agriculture will distribute the $290 million to dairy farmers through the DELAP program.  The program provides one-time payments to dairy farmers based on the amount of each dairy operation’s commercially produced and marketed milk from February to July 2009.  Farmers that participated in a fiscal year 2009 USDA dairy program do not have to sign up for the program:  the Farm Services Agency will use their previous milk production records to determine eligibility and the distribution of payments.

Payments to farmers will be determined by a national per hundred weight payment rate based on a factoring of the available $290 million, divided by the total pounds of eligible milk production from all eligible dairy operations.  The estimated payment rate is at $0.32 per hundredweight.  However, because the appropriated funding amount is fixed, the national payment rate and individual payments can only be calculated after production levels have been determined from program participants.

The funding comes from an amendment, cosponsored by Senator Klobuchar, included in the FY 2010 Agricultural Appropriations Act that secured $350 million to help struggling dairy farmers.  It provides the U.S. Department of Agriculture (USDA) with $290 million in direct support to dairy farmers to be distributed as determined by the Secretary of Agriculture and $60 million in additional funds to enable the USDA to increase the level at which the government buys surplus dairy products off the market.

Klobuchar has previously underscored the statewide impact of low dairy prices. Minnesota is the sixth largest dairy producing state and is home to nearly a half million dairy cows which together produce nearly nine billion pounds of dairy products each year. The price of milk has dropped from $19 per hundredweight to $11 per hundredweight.  From January through September 2009, the all-milk price received by farmers was 36 percent below a year earlier.

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